Home POLITICS Ted Baker warns on profits amid ‘extremely difficult trading’ – Sky News

Ted Baker warns on profits amid ‘extremely difficult trading’ – Sky News

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Ted Baker warns on profits amid ‘extremely difficult trading’ – Sky News

Fashion chain Ted Baker has warned of lower-than-expected pre-tax profits this year amid “extremely difficult trading”.

The company said on Tuesday that pre-tax profits for the year to January 2020, initially projected to be in excess of £70m, are now expected to come up short at between £50m and £60m.

The retailer said that “ongoing consumer uncertainty” in a number of its key markets, and an increase in its marketing activity across territories resulted in “extremely difficult trading conditions” during the current financial year.

“The board anticipates some of these external factors will continue to impact trade for the group and its trading partners across the remainder of the financial year,” it said in a trading statement.

Ted Baker’s profit warning comes at a challenging time for UK retailers, with multiple collapses of high street chains in the first half of 2019, continuing the trend from the previous year.

On Tuesday, so-called “fast fashion” chain Quiz saw its annual pre-tax profits collapse by 97% to £200,000, from £8.5m in the previous year.

Revenues rose 12% to £130.8m for the year.

The company blamed the profit downturn on the decline in high street footfall and weakened consumer confidence amid political uncertainty.

Lindsay Page, Ted Baker’s chief executive said the group remained confident in its long-term growth prospects.

He said: “As a team, we are proactively addressing the challenges we face as an industry.

“Several of our new product initiatives will commence imminently and we are confident in our collections for the coming season.

“We are relentlessly focused on achieving cost efficiencies as well as further cost savings throughout the business.”

Ted Baker shares slumped by more than 26% as markets opened on Tuesday.

The retailer has had a turbulent few years, mired in profit warnings and reeling from allegations of inappropriate behaviour.

Ted Baker denied there was a culture of 'forced hugs' at the firm

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Ex-Ted Baker CEO Ray Kelvin resigned in March 2020 amid the ‘forced hugs’ scandal

Ted Baker also issued a similar warning for last year’s annual pre-tax profits, when expectations fell from almost £74m to £63m for the year to 26 January.

At the time, the company blamed foreign currency movements to the tune of £2.5m, additional product costs of £2.5m and a £5m write-down on the value of “aged stock” in Asia and the US.

In 2018, the group was also rocked by the “forced hugs” scandal, sparked when harassment allegations made against former chief executive Ray Kelvin were investigated.

Mr Kelvin resigned from the company in March.

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